LANSING, Mich. (Michigan News Source) – With Democratic Governor Whitmer’s insistence on supporting abortion and vetoing adoption funding in July of this year, she has shut off resources for state money being available for
organizations that provide adoption services.

This summer, even with the state awash in tax dollars, Whitmer decided to veto millions of dollars of adoption funding that the Republicans had included in the budget – a budget which was the largest in the state’s history. Whitmer called the adoption funding harmful and used her line-item veto power to get rid of about $25.5 million of funding which would have been available to support pregnancy resources and adoption alternatives like those offered by the Detroit organization “Homes for Black Children” (HBC).

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But instead of extending a helping hand to adoption agencies, the Department of Health and Human Services Child Welfare Division plans to revoke the HBC’s license on Friday for what they cite as “financial instability.”

Because of financial issues in the past and struggles during the pandemic, the HBC was not able to get financially solvent until more recently.

President and CEO Jacquelynn Moffett told Michigan News Source that even though they had a net profit of $70,000 in 2021, the state is still planning to shut them down.

HBC was founded in 1969 by the United Way of Southeastern Michigan following the 1967 riots to reduce the large number of black children who were languishing in foster care.

It services Wayne County and although the agency was initially developed to support African-American families and children, a 2015 report from a site visit says that the organization provides services to families of all races and ethnicities with approximately 80% of their clientele residing in the city of Detroit.

Since the group was founded, the HBC has successfully provided adoption services to more than 2,000 children of all ages including sibling groups.

Moffett’s daughter, Alex Moffett-Bateau, tweeted about situation recently as well as a call to contact the governor’s office to stop the closing of the organization. Moffett-Bateau holds a Ph.D. in Political Science from the University of Chicago and a BA in Political Science and African American Studies from the University of Michigan-Ann Arbor. She’s currently an Assistant Professor of Political Science at John Jay College of Criminal Justice-City University of New York.

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She said, “In a post-Roe v Wade world, it makes zero sense that politicians are pointing to adoption as an ideal alternative to abortion and yet systematically under-funding every adoption agency in the state of Michigan.”

She also pointed out that in just three years since its founding, the HBC had “significantly reduced the number of black children who were not provided adoption opportunities. She said, “HBC accomplished this via the creation of innovative community based, culturally competent practices.”

Moffett-Bateau tweeted about the lack of financial support, “The larger funders throughout the state have been slowly receding their support from adoptions. They want to get out of the business of funding adoptions. As a result, small agencies have been shutting their doors at a record pace. Agencies like Catholic Social Services, the one time largest provider of adoption services, closed their doors due to lack of adoption funding while other agencies refuse to offer adoption services.”

Jacquelynn Moffett, who has been with the agency since 1976 where she started as a social worker, says that the organization was previously funded by the United Way but due to changes in their donor base, the funding has gone down to about $50,000 a year instead of in the past where it was around $440,000.

Moffett said that they have had five major grants from the federal government with the last one ending in 2016. She says, “now our funding is state contracts in adoption and foster care.” Moffet says, “Our situation is very similar to Historic Black Colleges in that we have limited opportunities for outside resources.”

Moffett-Bateau tweeted about the financial situation and how that led to the impending closure. She said, “Because of underfunding over time HBC’s revenue has been reduced, creating a situation whereby our liabilities exceed our revenue. This is especially true for small agencies such as ours who have small community-based boards and limited fundraising opportunities.”

They began to have serious cash flow problems in the years 2016-2018, with delays in paying foster parents and staff. Their cash flow crisis was further exacerbated by delays in payment from the state of Michigan.

Late payments were reported to the state in 2019 by a foster parent which triggered a review by the Auditor General’s office. The report was finalized in April of 2020 and then COVID hit which led to HBC having a deficit at the year end of 2020. The report criticized staff loans to assist cash flow and voluntary staff payless pay days. Moffett-Bateau tweeted, “The state of Michigan couldn’t understand why a black staff of social workers, many who’ve worked at HBC since its opening, would volunteer to go without salary so that more vulnerable staff could be paid…”

Although community members and staff donated to try to meet the shortfall from the “absence of funding for adoption and foster care from the state of Michigan” it was not enough.

By 2021, however, Moffett-Bateau says they had a “fully implemented restructured organization” and had created a “100% turnaround.”

She said, “HBC’s external audited financial statement submitted to the MDHHS on September 30, 2022 substantiated a surplus over over $70,000. They are current on all expensed, payments and vendors and have been since mid-2020. This was verified through an ongoing Special Licensing Evaluation.”

However, HBC was told that the “revocation” of their license will occur on Friday, October 28th, with the state of Michigan citing “financial instability.” Moffett-Bateau says that the most recent special investigation was opened in January of 2022 and their findings are “based on calendar years 2016, 2017 and 2018 with the most recent audit (2021) not considered.”

Although Moffett-Bateau says they are “very sensitive to the directors of MDHHS” and are not overlooking the seriousness of their concerns, they ask that the recent efforts and work of the HBC are considered in their deliberations.

However, the revocation of the license is still scheduled for Friday. Michigan News Source reached out to the Michigan Department of Health & Human Services and asked about the closure. Bob Wheaton, Public Information Officer responded with the following information. He said, “MDHHS’s top priority is to ensure the safety and well-being of children in care. Significant financial instability at this agency over the last four years threatens its ability to
manage the cases of vulnerable children. At times the agency has been unable to pay foster parents promptly, which could affect the financial support they need to provide for the children in their care.”

Wheaton continued, “Employees have not always received their paychecks on time. Debt is greater than what can be offset, and the agency has shown large deficits every fiscal year since 2017. While MDHHS appreciates the heartfelt support from community members, the department has completed a thorough investigation and must initiate the process required under Public Act 116 to protect children,” he said. “That law requires the department to first issue a notice of intent to revoke the license. At that point, the agency can request a status conference and has 30 days to seek a hearing before an administrative law judge. After a recommendation from the administrative law judge, the department director would make a final decision.”

To conclude, Wheaton added, “MDHHS action – while difficult – is necessary for the good of children in care. If the license is revoked, MDHHS will ensure that all children’s cases are transferred to another agency that can meet their needs. Those families can continue to care for them if the organization loses its licenses. For clarification purposes, we want to note that this is a child-placing agency that finds foster homes and adoptive homes for children. The agency does not provide residential congregate care for children,” Wheaton said.